Personal Income Tax
Personal Income Tax (PIT) is a direct tax levied on income of a person. A person means an individual, an ordinary partnership, a non-juristic body of person and an undivided estate. In general, a person liable to PIT has to compute his tax liability, file tax return and pay tax, if any, accordingly on a calendar year basis.
1. Taxable Persons
Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.
2. Assessable Income
Income chargeable to the PIT is called “assessable income”. The term covers income both in cash and in kind. Therefore, any benefits provided by an employer or other persons, such as rent-free house or the amount of tax paid by the employer on behalf of the employee, are also treated as assessable income of the employer for the purpose of PIT. Assessable income is divided into eight categories:
- Income from personal services rendered to employers;
- Income by virtue of jobs, positions or services rendered;
- Income from goodwill, copyright, franchise, other rights, annuity or income in the nature of yearly payments derived from a will or any other juristic Act or judgment of the Court;
- Income in the nature of dividends, interest on deposits with banks in Thailand, shares of profits or other benefits from a juristic company, juristic partnership, or mutual fund, payments received as a result of the reduction of capital, a bonus, an increased capital holdings, gains from amalgamation, acquisition or dissolution of juristic companies or partnerships, and gains from transferring of shares or partnership holdings;
- Income from letting of property and from breaches of contracts, installment sales or hire-purchase contracts;
- Income from liberal professions;
- Income from construction and other contracts of work;
- Income from business, commerce, agriculture, industry, transport or any other activity not specified earlier.
3. Deduction and Allowance
Certain deductions and allowances are allowed in the calculation of the taxable income. Taxpayer shall make deductions from assessable income before the allowances are granted. Therefore, taxable income is calculated by:
Taxable income = Assess sable Income – deductions – allowance
3.1 Deductions allowed for the calculation of PIT
| Type of Income | Deduction |
| a. Income from employment | 40% but not exceeding 60,000 baht |
| b. Income received from copyright | 40% but not exceeding 60,000 baht |
| c. Income from letting out of property on hire | |
| 1) Building and wharves | 30% |
| 2) Agricultural land | 20% |
| 3) All other types of land | 15% |
| 4) Vehicles | 30% |
| 5) Any other type of property | 10% |
| d. Income from liberal professions | 30% except for the medical profession where 60% is allowed |
| e. Income derived from contract of work whereby the contractor provides essential materials besides tools | Actual expense or 70% |
| f. Income derived from business, commerce, agriculture, industry, transport, or any other activities not specified in a. to e. | Actual expense or 65% – 85% depending on the types of income |
3.2 Allowances (Exemptions) allowed for the calculation of PIT
| Type of Allowances | Amount |
| Personal allowance | |
| Single taxpayer | 30,000 baht for the taxpayer |
| Undivided estate | 30,000 baht for the taxpayer’s spouse |
| Non-juristic partnership or body of person | 30,000 baht for each partner but not exceeding 60,000 baht in total |
| Spouse allowance | 30,000 baht |
| Child allowance (child under 25 years of age and studying at educational institution, or a minor, or an adjusted incompetent or quasi-incompetent person) | 15,000 baht each (limited to three children) |
| Education (additional allowance for child studying in educational institution in Thailand) | 2,000 baht each child |
| Parents allowance | 30,000 baht for each of taxpayer’s and spouse’s parents if such parent is above 60 years old and earns less than 30,000 baht |
| Life insurance premium paid by taxpayer or spouse | Amount actually paid but not exceeding 100,000 baht each |
| Approved provident fund contributions paid by taxpayer or spouse | Amount actually paid at the rate not more than 15% of wage, but not exceeding 500,000 baht |
| Long term equity fund | Amount actually paid at the rate not more than15% of wage, but not exceeding 500,000 baht |
| Home mortgage interest | Amount actually paid but not exceeding 100,000 baht |
| Social insurance contributions paid by taxpayer or spouse | Amount actually paid each |
| Charitable contribution | Amount actually donated but not exceeding 10% of the income after standard deductions and the above allowances |
For more information, please feel free to contact us:
Phone: +66 2 933 9000
Fax: +66 2 933 6120
Email: bkk@panwa.co.th